OBJECTIVES
At the end of two (2) hours, the participants will be able
to:
1. Discuss the KC-NCDDP Financial Management
2. Identify the roles, and functions of ACT in Financial
Management
3. Compute the municipal grant allocation, and LCC of
their respective areas
KEY RESULT AREAS
1. clear understanding of the KC-NCDDP Financial
Management
2. clear understanding of the roles, and functions of
the ACT
3. municipal grant allocation, and LCC
computation
COMMUNITY-BASED
FINANCIAL MANAGEMENT
Area Coordinating Team Orientation
OUTLINE
• Overview of Community-Based Financial Management
• Community Grants
• Technical Assistance Fund (TAF)
• Request for Fund Release (RFR) Process
• eRFR System
• Local Counterpart Contributions
• Cash Management
• Financial Management Roles
• DSWD, MLGU, ACT and Barangay Assembly
WHAT IS IN CBFM?
Simplified financial management systems and procedures…
AUDIT
To ensure efficient, transparent, and honest handling of sub-project funds.Financial
Monitoring.docx
IS CBFM DIFFERENT FROM GAAM?
• The CBFM follows the usual government laws, rules and
regulations on fund receipts and disbursements except for
some unique features.
• For example, the community is allowed to make partial
payment to partially delivered indigenous materials.
• But, systems and procedures provided in the CBFM are
simpler. Forms, books and reports are formatted for easier
use.
• It follows the same internal audit principles but with very
straightforward methods and procedures.
WHY IS CBFM IMPORTANT?
• One key feature of CDD is making resources
available to communities.
• In the KALAHI-CIDSS, this is undertaken through
direct fund transfers to a community account,
guided by the “one-fund concept”.
• It means, management of funds is done at the
community level.
• Hence, it is critical for community members
and local volunteers to have a basic
understanding of financial management and
accounting procedures to ensure that these
resources are efficiently utilized for its intended
purpose.
WHAT ARE THE SOURCES FUNDS?
• DSWD Grant Funds
• TAF = P15,000 per barangay
• MGA per cycle = Allocation per head x population
 but not lower than P2,000,000 and not higher than P20,000,000
• Released in tranches (50-40-10 to 80-10-10; 90-10 for DRO)
• Grants Excess Fund.doc
• Local Counterpart Contributions (same as GPBP requirements)
• Year 1 (2014)
• For 554 (177+377) Munis – Capacity Building and Implementation Support (CBIS)
Only
• For 293 Munis – Sub-Project Implementation (SPI) + CBIS
• Year 2 (2015)
• All municipalities – SPI + CBIS
• NCDDP Module 3_Grants and LCC 2.ppt
TECHNICAL ASSISTANCE FUND (TAF)
• TAF ALLOCATION = P15,000 per barangay
• Under DRO, TAF IS REGIONALLY-MANAGED
• For Non-Yolanda affected areas:
• Community-managed or Regionally-managed
• ELIGIBLE EXPENSES
• Professional Fees
• Pre-Engineering Works
• Supervision
• Preparation of Feasibility Studies (Livelihood proposals)
• Reproduction of plans, designs and drawings
• Salaries, travel expenses, communication and supplies of hired technical experts
• The TAF may be used for sub-project proposals that are NOT technically complicated or with proforma plans.
DSWD RO-MANAGED TAF
• Basis for the Municipality to avail TAF
• MDRRMC Resolution to request TAF
• Purpose i.e. Pre-Engineering, FS or Supervision; Amount
• SRPMO to:
• Review and consolidate TA needs
• Allocate resources according to TA needs
• Recommend to RPMO results of resource allocation
• RPMO
• Procurement of TA Providers following Program Procurement guidelines
• Disbursement shall follow Program Finance guidelines
COMMUNITY-MANAGED TAF
• If there are barangays that are in need of technical assistance, the MIBF will
pass a Resolution to avail TAF from the municipal allocation and engage
technical support personnel. The MIBF will elect one barangay to lead the
search for qualified technical service providers with the assistance of the
ACT.
• The elected lead barangay will secure a Barangay Council Resolution
authorizing the PPT Head or BSPMC Chair (if already selected), the Treasurer
and AC to open a checking account with the nearest Land Bank of the
Philippines branch. The account name must be “DSWD-KALAHINCDDP/(Name of Barangay)”.
COMMUNITY-MANAGED TAF)
• The Treasurer shall apply for additional bond to the Bureau of Treasury in
case premium paid is insufficient to cover current maximum accountability
(determined by computing average amount of checks to be signed per
month). Payment for the bond premium will be from LCC cash.
• The ACT will generate a list of potential service providers for technical
assistance. The list must show the names of individuals or firms with
corresponding areas of expertise and experience. The ACT may also
coordinate with regional and provincial-based professional organizations
for their list of experts (e.g. PICE, PICPA, etc.)
• The potential service providers may be invited to be oriented on the Terms
of Reference (TOR). Procurement will follow the appropriate method as
provided in the Community-Based Procurement Manual.
RFR PROCESS
Disburses Funds
Releases Funds to
Community
Account
Reviews and
approves RFR;
Processes Release
of Funds
Submits the RFR and its
supporting documents to
the ACT
Reviews and
endorses RFR to the
SRPMO
Reviews and
recommends RFR
to the RPMO
ERFR SYSTEM FEATURES
• Assign distinct subproject ID which happens upon data entry of the MIBF result;
• Consolidate Community Grants Disbursement Plan(CGDP) on the basis of the MIBF results
and SPI programming done at the community level.
• The CGDP shall be the basis for the assigning of appropriate fund source, issuance of SubAllotment Advise (SAA) and transfer of community grant funds by the CO to the FO for
onward release to the community bank account;
• Generate and print the RFR for the signature of concerned signatories at all levels
containing all necessary SP information previously encoded; and
• Generate and print Obligation Request (ObR) and Disbursement Voucher (DV) containing
the amount requested and the fund source.
• electronic RFR System (eRFRS) - Orientation.pptx
LOCAL COUNTERPART CONTRIBUTIONS (LCC)
• Year 1 (2014)
• For 554 (177+377) Munis – Exempted from LCC except for CBIS
• For 293 Munis – Sub-Project Implementation + CBIS
LGU CLASS
LCC
Highly Urbanized cities
30% of Project Cost
All other cities
20% of Project Cost
1st to 3rd class
15% of Project Cost
4th to 6th class
5% of Project Cost
LOCAL COUNTERPART CONTRIBUTIONS (LCC)
• Year 2 (2015)
• All Munis – Sub-Project Implementation + CBIS
LCC CLASSIFICATION
• LCC – CBIS
– Not part of SP value
– Intended for conduct of
Project activities
– Cash and in-kind
(ex: CEAC, office space,
ACT facilities, IT
equipment)
– Based on approved LCC
Delivery Plan (planned by
MLGU, approved by
DSWD, concurred by SB
thru a budget ordinance)
– Handled by MFA
• LCC – SPI
• Form part of SP investment
cost
• Intended for direct or indirect
SP costs
• Cash is directly deposited to
community account
• In-Kind are materials, labor,
equipment, and other direct
or indirect committed costs
• Commitments are reflected
in the POW, approved by
MIBF
LGU PROJECT AS LCC
• Must be indicated in the approved LPRAP.
• Must be presented and declared in the MIBF that said Project will
serve as LCC.
• Hence, the LCC-Project will now be counted as KC-NCDDP SubProject.
• The MIBF Resolution should reflect if the LCC-Project of the LGU will
also be used as LCC for other agencies for proper notation in the
financial and physical monitoring reports.
• Manage the risks involved in non-delivery.
WHY REQUIRE LCC?
“Kami ang
gumawa dito.
Habangbuhay
sa amin ito.”
Ownership leads to experienced responsibility and stewardship.
CASH MANAGEMENT
• The Barangay Treasurer is automatically the BSPMC Treasurer who
handles cashiering
• The community opens a current account with three signatories:
Treasurer, BSPMC Chairperson and Area Coordinator
• Account for KC-NCDDP cannot be used for other CDD Projects like
GPBP and PAMANA
• All cash received for the sub-project are deposited to the current
account
• All payments are made through issuance of check
• The Treasurer is allowed to cash advance for the following:
• Petty Cash Fund of up to P10,000 (replenishment)
• Payroll during disaster of up to P50,000
• Pay indigenous materials to non-registered suppliers subject to NOL
Internal Control Guidelines.docx
FM ROLES OF DSWD AND MLGU
• DSWD
• Implement the Project in accordance with the provisions
of the Loan/Grant Agreements
• Provide counterpart contribution (GOP funds)
• Safeguard project funds
• MLGU
• Provide counterpart contribution
• Co-implement the Project
• Operate, maintain and sustain completed subprojects
FM ROLES OF ACT
• Primary responsible for protecting project funds
and for providing technical assistance to the
community volunteers on financial management.
• Ensure compliance by the Local partners of the
provisions of the Memorandum of Agreement
(MOA) for the project, particularly on the prompt
delivery of the local counterpart contributions
(LCC);
• Review the validity, propriety, and accuracy of
Requests for Fund Release and all supporting
documents submitted by the community volunteers;
FM ROLES OF ACT
• Review the validity, propriety and completeness of
community disbursements;
• Provide necessary technical assistance to the
community volunteers in all aspects of NCDDP
implementation;
• Monitor and validate the physical and financial
status of approved subprojects;
AREA COORDINATOR
• Protect Project funds. As one of the co-signatories of the
community’s bank account, he/she shall ensure that all
disbursement vouchers are reviewed by the Municipal
Financial Analyst before signing the checks.
• Assist the communities in resource accessing.
• Coordinate with Donors to ensure timely delivery of
committed Local Counterpart Contributions.
• Evaluate the request of the communities for technical
assistance fund.
AREA COORDINATOR
• Review, evaluate and sign Requests for Fund Release
(RFR).
• Review and approve all financial reports prepared by the
Municipal Financial Analyst and ensure that these and
other financial documents especially the original paid
Disbursement Vouchers and its supporting documents are
submitted completely and on time to the RPMT.
• Investigate finance-related issues and complaints and
immediately submit written report and recommendations
to the RPMO to prevent any possible misuse of funds.
DEPUTY AREA COORDINATOR
• Act as an alternate co-signatory of all financial transactions at the
community level in the absence of the AC
• Provide adequate technical assistance to the different Barangay
Project Preparation Team (PPTs) in the preparation of sub-project
concepts for the Municipal Inter-Barangay Forum for Participatory
Resource Allocation (MIBF-PRA) so that proposals submitted are
realistic, especially in regards to the cost estimates.
• Conduct technical review of the sub-project proposals submitted by
the communities. The review will include but not limited to the
following:
• Detailed cost estimates used in the proposed budget;
• Assignment of monetary value to local contributions in kind; and
• Assessment of the capability of communities to contribute.
DEPUTY AREA COORDINATOR
• Assist the Audit and Inventory Committee, through job coaching in the:
• inspection of the delivery of materials;
• audit of materials inventory; and,
• valuation of unutilized materials
• Monitor the physical progress of sub-project implementation and regularly
compare against the Municipal Financial Analyst’s records of the community’s
fund utilization.
• Provide regular updates to the Area Coordinator.
• Only in cases where there is no Area Coordinator hired yet or the hired Area
Coordinator has gone on official leave, the Barangay Council shall execute a
Resolution authorizing the Deputy Area Coordinator to temporarily replace the
Area Coordinator as one of the signatories of the community’s account. The
execution of the Barangay Resolution for the purpose shall be on the basis of
the recommendation from the RPMO. In no case shall the AC and DAC be
authorized as co-signatories to the community bank account at the same time.
MUNICIPAL FINANCIAL ANALYST
• Provide technical inputs in the preparation and review of
Program of Works (POW) particularly on the reasonableness
of costs and appropriateness of items charged under the
Indirect Costs.
• Review all Requests for Fund Release (RFR) including
completeness, validity and consistency of data of all required
supporting documents. Maintain RFR tracking system.
• Review and sign all Disbursement Vouchers prior to AC’s
signature of check.
• Monitor and validate financial sub-project status of the
communities through field visits.
MUNICIPAL FINANCIAL ANALYST
• Monitor delivery and utilization of LCC including Municipal Trust
Account based on the approved LCC Delivery Plan and provides
timely feedback to AC for appropriate action in case of potential
delay.
• Initiate Municipal Fiduciary Workshops.
• Prepare and timely submit municipal financial monitoring reports to the
SRPMT. Make sure that soft reports are properly backed-up with hard
copies.
• Provide regular financial updates to the MCT/MIAC/TWG and other
stakeholders.
• Submit monthly feedback report (narrative) to the Regional Financial
Analyst as regards community financial management system.
• Provide regular updates to the Area Coordinator.
COMMUNITY EMPOWERMENT FACILITATOR
• Motivate the BSPMC Financial Management volunteers to
perform their functions.
• Initially review Disbursement Vouchers as to completeness of
documents and validity of transactions.
• Assist the BSPMCs, especially the Treasurers in installing a filing
system.
• Monitor compliance of FM volunteers on the filing system
installed.
• Provide updates to MFA regarding the communities’ financial
status.
• Provide feedback on the over-all status of sub-project
implementation to the Area Coordinator.
ROLES OF MCT
• To support KC-NCDDP implementation in the
municipality.
• Their functions are the same as that of the ACT
since they are expected to gradually take over
facilitation of the processes by the third cycle.
• However, the AC or DAC of the MCT can never be
co-signatory of the community accounts.
ROLES OF THE BARANGAY ASSEMBLY
The primary role of the community is to implement the approved sub-project,
ensure that its objectives are attained and that there is proper accountability.
The community shall organize itself for this purpose as indicated in the above
organizational structure. All community members should have equal input and
special efforts should be made to ensure equal participation of all groups in
the community, particularly women, youth, the elderly and IPs. Community
members therefore have the responsibility to do the following:
• Attend Barangay Assemblies
• Participate actively in decision making processes and selection of barangay sub-project
implementation team members
• Vulnerable groups (i.e. women, youth, IPs) are encouraged to organize themselves in
order to make sure their voices are heard and needs addressed in sub-project selection
and implementation
• Review the sub-project implementation plan and budget
ROLES OF THE BARANGAY ASSEMBLY
• Monitor sub-project implementation (procurement, inspection of deliveries,
use of all delivered materials, construction, etc.)
• Inform the BSPMC if full transparency is not being practiced or if there are
negative observations, such as:
• No publication or announcement related to procurement, approved contracts, or
expenditures
• No barangay assembly is called to make a report to the community about sub-project
and financial status
• Questionable conduct of procurement process, sub-standard materials used,
implementation not according to program of work, etc.
• Report inaction of the BSPMC to the ACT or directly to the DSWD Grievance
and Complaints Unit
• Provide the agreed counterpart contribution (lot, labor, materials, etc.)
• Participate in operations and maintenance of the sub-project after
completion.
KEY MESSAGE 1
Financial Management is
the efficient,
transparent, and honest handling of all moneys
or funds associated with a community subproject.
KEY MESSAGE 2
Financial management is one of the most
important activities for efficient and successful
sub-project implementation.
KEY MESSAGE
3
Funds are NOT ACT managed – these are
government funds donated to community
beneficiaries but subject to transparent and
accountability use.
THANK YOU!